Providing perspective on the economics and politics of sports business in Florida...and the Rays' campaign for a new stadium in Tampa Bay.

Saturday, February 21, 2015

St. Pete Councilman Poses Sobering Questions on Stadium Saga

Good story over on SaintPetersblog about a St. Pete councilman who doesn't always speak up...but when he does, it's worth listening to. Excerpts from the story on Karl Nurse and funding a new Rays stadium:

“As you begin to piece together, well if
you continue the six million a year the city’s been paying for debt
service …. 2 million a year from the state …” Nurse trailed off. There’s
also the county’s tourist tax kicked in for Tropicana Field. “That now
gets you, perhaps, 40-50 percent the way toward a stadium.”

It's actually 3 million a year now from the state, thanks to Pinellas lawmaker Jack Latvala. And we're talking about enough revenue to bond $300+ million in construction...a heck of a lot more than Hillsborough County could piece together right now. But still several hundred million short of the expected price of a stadium.

“What it really tells you is that you’ve
got to find a way to say, the Rays are likely to have to pay a larger
share than they have in mind and you’ve got to find someway to bring a
developer in there so that whatever you build generates additional
revenue that can go towards the stadium,” Nurse said.

...

“All sports teams have vastly overstated
their economic impact,” Nurse said. So why not figure out just how much
money the Rays make for the city?...Nurse said professional sports is not a good community investment, but that doesn’t mean give them the boot.

“Generally communities say this is something they want even if it doesn’t make economic sense,” he said.

But even if the city wants to keep the
Rays, and they do, and even if fans want to keep them, they definitely
do, it may not matter.

“I think it really depends upon what are
either side of the bay willing to pay? Can you bring a third developer
in to help facilitate part of the cost,” Nurse asked. “Are the Rays
willing to accept the fact that they are located in a growing television
market, which, no matter where you put a stadium, is going to be
inconvenient for a third or 40 percent of the region?”

4 comments:

Private philanthropy is the best solution for these troubled businesses. Create some commercials showing Susan Sarandon holding a fly-covered Rays exec in her arms somewhere in East Africa. For just 10 cents a day, adopt a cinder block. THE MOU PROHIBITED THE CITY COUNCIL FROM REJECTING THE FINAL DEAL FOR AN EARLY RAYS DEPARTURE. (MOU Section 5(A)). It required the Council to completely abdicate any future bargaining power. Pretending this is about development rights is a farce. These shysters are selling god-damn snake oil. Don't let the baby pictures and empty non-answers convince any of us otherwise. They are using clever lawyering to reach for your wallet.

But the biggest surprise is the deviation from the literature in the effect of winning on attendance. My results show that fans in the Tampa Bay area do not respond to winning on a game-to-game basis. This would seem to indicate that the Rays have maximized the return on winning to attendance. In other words, if the Rays wish to increase their attendance, winning more isn’t an option.

If the problem was simply growing a generation of hometown baseball fans, that would be ambitious enough. But adding on top of that an ambitious shift from car culture to mass transit might be asking too much. Some places just aren't right for certain industries. That isn't an indictment of the Tampa Bay area. It is simply to admit that our comparative economic advantages lie elsewhere. The ease of hopping in a rental car and heading to a beach with the family has a lot to do with the strength of tourism in Florida. Can we make mass transit a workable alternative/addition? This is a baseball leap of faith stacked on top of a transit leap of faith, with hundreds of millions at stake, to say nothing of the opportunity costs.